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Departments Finally Publish Updated SBC Template and Instructions

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On April 6, 2016, the Departments of Health and Human Services, Labor and Treasury (the “Departments”) issued an updated Summary of Benefits and Coverage (“SBC”) template.  The latest template represents an effort by the Departments to enhance consumer access to information regarding their health care options.

Although the new template is shorter than the prior version, it includes more detailed information about cost-sharing, deductibles and out-of-pocket limits.  Moreover, the template adds a new example describing coverage for an in-network emergency room visit.  The Departments intend that these additions will provide consumers with more meaningful information as they select their medical coverage.          

The revised SBC template must be used beginning with the first open enrollment period on or after April 1, 2017.  The updated template and the related instructions are available on the Department of Labor website.

Under the Affordable Care Act, health plans and issuers are required to provide an SBC to all employees and beneficiaries.  An SBC must be provided during open enrollment, at initial or special enrollment and upon request.  The penalties for failure to issue SBCs can be significant, as described in our July 19, 2012 newsletter.  Specifically, the Department of Labor may assess a penalty of $1,000 per failure per participant and the Internal Revenue Service may levy an excise tax of $100 per day per affected participant.

For more information about the SBC requirement, please see our Year-End Health & Welfare Checklist and our February 23, 2015 blog.